Supplemental Consolidating Data (Tables)

9 Months Ended

Sep. 29, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Operations

	Three months ended September 29, 2019
	HDMC Entities		HDFS Entities		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,074,397	$	—	$	(5,455	)	$	1,068,942
Financial Services	—		201,308		2,269			203,577
	1,074,397		201,308		(3,186		)	1,272,519
Costs and expenses:
Motorcycles and Related Products cost of goods sold	748,878		—		—			748,878
Financial Services interest expense	—		53,390		—			53,390
Financial Services provision for credit losses	—		33,747		—			33,747
Selling, administrative and engineering expense	269,080		42,996		(3,045		)	309,031
Restructuring expense	7,629		—		—			7,629
	1,025,587		130,133		(3,045		)	1,152,675
Operating income	48,810		71,175		(141		)	119,844
Other income (expense), net	3,160		—		—			3,160
Investment income	52,041		—		(50,000		)	2,041
Interest expense	7,789		—		—			7,789
Income before provision for income taxes	96,222		71,175		(50,141		)	117,256
Provision for income taxes	13,517		17,176		—			30,693
Net income	$	82,705	$	53,999	$	(50,141	)	$	86,563
	Nine months ended September 29, 2019
	HDMC Entities		HDFS Entities		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,714,091	$	—	$	(15,508	)	$	3,698,583
Financial Services	—		584,258		6,677			590,935
	3,714,091		584,258		(8,831		)	4,289,518
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,576,342		—		—			2,576,342
Financial Services interest expense	—		158,387		—			158,387
Financial Services provision for credit losses	—		94,621		—			94,621
Selling, administrative and engineering expense	764,848		129,170		(8,745		)	885,273
Restructuring expense	31,682		—		—			31,682
	3,372,872		382,178		(8,745		)	3,746,305
Operating income	341,219		202,080		(86		)	543,213
Other income (expense), net	11,857		—		—			11,857
Investment income	151,970		—		(140,000		)	11,970
Interest expense	23,304		—		—			23,304
Income before provision for income taxes	481,742		202,080		(140,086		)	543,736
Provision for income taxes	85,422		48,175		—			133,597
Net income	$	396,320	$	153,905	$	(140,086	)	$	410,139

	Three months ended September 30, 2018
	HDMC Entities			HDFS Entities		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,126,977		$	—	$	(3,032	)	$	1,123,945
Financial Services	—			192,188		(464		)	191,724
	1,126,977			192,188		(3,496		)	1,315,669
Costs and expenses:
Motorcycles and Related Products cost of goods sold	776,530			—		—			776,530
Financial Services interest expense	—			44,696		—			44,696
Financial Services provision for credit losses	—			23,530		—			23,530
Selling, administrative and engineering expense	267,316			42,776		(3,427		)	306,665
Restructuring expense	14,832			—		—			14,832
	1,058,678			111,002		(3,427		)	1,166,253
Operating income	68,299			81,186		(69		)	149,416
Other income (expense), net	644			—		—			644
Investment loss	(1,106		)	—		—			(1,106		)
Interest expense	7,762			—		—			7,762
Income before provision for income taxes	60,075			81,186		(69		)	141,192
Provision for income taxes	10,613			16,724		—			27,337
Net income	$	49,462		$	64,462	$	(69	)	$	113,855
	Nine months ended September 30, 2018
	HDMC Entities			HDFS Entities		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	4,021,268		$	—	$	(8,255	)	$	4,013,013
Financial Services	—			559,436		(1,436		)	558,000
	4,021,268			559,436		(9,691		)	4,571,013
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,659,740			—		—			2,659,740
Financial Services interest expense	—			145,089		—			145,089
Financial Services provision for credit losses	—			72,462		—			72,462
Selling, administrative and engineering expense	798,544			120,830		(9,476		)	909,898
Restructuring expense	74,044			—		—			74,044
	3,532,328			338,381		(9,476		)	3,861,233
Operating income	488,940			221,055		(215		)	709,780
Other income (expense), net	1,509			—		—			1,509
Investment income	112,630			—		(110,000		)	2,630
Interest expense	23,180			—		—			23,180
Income before provision for income taxes	579,899			221,055		(110,215		)	690,739
Provision for income taxes	110,529			49,254		—			159,783
Net income	$	469,370		$	171,801	$	(110,215	)	$	530,956

Balance Sheet

	September 29, 2019
	HDMC Entities		HDFS Entities		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	482,106	$	380,275	$	—		$	862,381
Accounts receivable, net	635,997		—		(328,381		)	307,616
Finance receivables, net	—		2,210,001		—			2,210,001
Inventories	489,098		—		—			489,098
Restricted cash	—		79,115		—			79,115
Other current assets	109,724		46,013		(14,951		)	140,786
	1,716,925		2,715,404		(343,332		)	4,088,997
Finance receivables, net	—		5,305,579		—			5,305,579
Property, plant and equipment, net	791,107		53,339		—			844,446
Goodwill	63,727		—		—			63,727
Deferred income taxes	92,921		40,411		(1,313		)	132,019
Lease assets	49,706		6,199		—			55,905
Other long-term assets	157,341		20,401		(92,185		)	85,557
	$	2,871,727	$	8,141,333	$	(436,830	)	$	10,576,230
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	314,843	$	362,489	$	(328,381	)	$	348,951
Accrued liabilities	462,644		108,719		(14,373		)	556,990
Short-term debt	—		1,013,137		—			1,013,137
Current portion of long-term debt, net	—		1,779,673		—			1,779,673
	777,487		3,264,018		(342,754		)	3,698,751
Long-term debt, net	743,127		3,863,914		—			4,607,041
Lease liabilities	33,296		6,112		—			39,408
Pension liability	82,561		—		—			82,561
Postretirement healthcare liability	89,032		—		—			89,032
Other long-term liabilities	180,103		40,261		2,854			223,218
Commitments and contingencies (Note 17)
Shareholders’ equity	966,121		967,028		(96,930		)	1,836,219
	$	2,871,727	$	8,141,333	$	(436,830	)	$	10,576,230

	December 31, 2018
	HDMC Entities		HDFS Entities		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	544,548	$	659,218	$	—		$	1,203,766
Marketable securities	10,007		—		—			10,007
Accounts receivable, net	425,727		—		(119,253		)	306,474
Finance receivables, net	—		2,214,424		—			2,214,424
Inventories	556,128		—		—			556,128
Restricted cash	—		49,275		—			49,275
Other current assets	91,172		59,070		(5,874		)	144,368
	1,627,582		2,981,987		(125,127		)	4,484,442
Finance receivables, net	—		5,007,507		—			5,007,507
Property, plant and equipment, net	847,176		56,956		—			904,132
Goodwill	55,048		—		—			55,048
Deferred income taxes	105,388		37,603		(1,527		)	141,464
Other long-term assets	144,122		18,680		(89,731		)	73,071
	$	2,779,316	$	8,102,733	$	(216,385	)	$	10,665,664
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	258,587	$	145,527	$	(119,253	)	$	284,861
Accrued liabilities	496,643		110,063		(5,576		)	601,130
Short-term debt	—		1,135,810		—			1,135,810
Current portion of long-term debt, net	—		1,575,799		—			1,575,799
	755,230		2,967,199		(124,829		)	3,597,600
Long-term debt, net	742,624		4,145,043		—			4,887,667
Pension liability	107,776		—		—			107,776
Postretirement healthcare liability	94,453		—		—			94,453
Other long-term liabilities	164,243		37,142		2,834			204,219
Commitments and contingencies (Note 17)
Shareholders’ equity	914,990		953,349		(94,390		)	1,773,949
	$	2,779,316	$	8,102,733	$	(216,385	)	$	10,665,664

	September 30, 2018
	HDMC Entities		HDFS Entities		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	576,670	$	350,322	$	—		$	926,992
Marketable securities	10,011		—		—			10,011
Accounts receivable, net	640,416		—		(308,107		)	332,309
Finance receivables, net	—		2,116,386		—			2,116,386
Inventories	516,247		—		—			516,247
Restricted cash	—		36,471		—			36,471
Other current assets	106,259		44,783		—			151,042
	1,849,603		2,547,962		(308,107		)	4,089,458
Finance receivables, net	—		5,187,176		—			5,187,176
Property, plant and equipment, net	833,279		51,681		—			884,960
Prepaid pension costs	140,763		—		—			140,763
Goodwill	55,318		—		—			55,318
Deferred income taxes	25,780		39,203		(1,424		)	63,559
Other long-term assets	151,815		19,799		(89,048		)	82,566
	$	3,056,558	$	7,845,821	$	(398,579	)	$	10,503,800
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	291,395	$	327,679	$	(308,107	)	$	310,967
Accrued liabilities	483,964		80,427		441			564,832
Short-term debt	—		1,373,859		—			1,373,859
Current portion of long-term debt, net	—		1,526,156		—			1,526,156
	775,359		3,308,121		(307,666		)	3,775,814
Long-term debt, net	742,458		3,454,059		—			4,196,517
Pension liability	54,138		—		—			54,138
Postretirement healthcare liability	112,798		—		—			112,798
Other long-term liabilities	170,464		38,003		3,094			211,561
Commitments and contingencies (Note 17)
Shareholders’ equity	1,201,341		1,045,638		(94,007		)	2,152,972
	$	3,056,558	$	7,845,821	$	(398,579	)	$	10,503,800

Cash Flows

	Nine months ended September 29, 2019
	HDMC Entities			HDFS Entities			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	396,320		$	153,905		$	(140,086	)	$	410,139
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	168,013			6,596			—			174,609
Amortization of deferred loan origination costs	—			57,303			—			57,303
Amortization of financing origination fees	503			6,529			—			7,032
Provision for long-term employee benefits	10,888			—			—			10,888
Employee benefit plan contributions and payments	(11,166		)	—			—			(11,166		)
Stock compensation expense	22,869			2,454			—			25,323
Net change in wholesale finance receivables related to sales	—			—			683			683
Provision for credit losses	—			94,621			—			94,621
Deferred income taxes	5,514			(1,765		)	(214		)	3,535
Other, net	9,126			(1,372		)	85			7,839
Changes in current assets and liabilities:
Accounts receivable, net	(216,961		)	—			209,128			(7,833		)
Finance receivables - accrued interest and other	—			(4,574		)	—			(4,574		)
Inventories	62,870			—			—			62,870
Accounts payable and accrued liabilities	8,729			207,971			(203,562		)	13,138
Derivative instruments	2,443			94			—			2,537
Other	(19,516		)	12,144			9,077			1,705
	43,312			380,001			15,197			438,510
Net cash provided by operating activities	439,632			533,906			(124,889		)	848,649
Cash flows from investing activities:
Capital expenditures	(118,182		)	(2,979		)	—			(121,161		)
Origination of finance receivables	—			(5,757,384		)	2,615,758			(3,141,626		)
Collections on finance receivables	—			5,326,787			(2,630,869		)	2,695,918
Sales and redemptions of marketable securities	10,007			—			—			10,007
Acquisition of business	(7,000		)	—			—			(7,000		)
Other investing activities	12,388			—			—			12,388
Net cash used by investing activities	(102,787		)	(433,576		)	(15,111		)	(551,474		)

	Nine months ended September 29, 2019
	HDMC Entities			HDFS Entities			Eliminations		Consolidated
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—			546,655			—		546,655
Repayments of medium-term notes	—			(1,350,000		)	—		(1,350,000		)
Proceeds from securitization debt	—			1,021,353			—		1,021,353
Repayments of securitization debt	—			(244,250		)	—		(244,250		)
Borrowings of asset-backed commercial paper	—			177,950			—		177,950
Repayments of asset-backed commercial paper	—			(240,008		)	—		(240,008		)
Net decrease in credit facilities and unsecured commercial paper	—			(120,707		)	—		(120,707		)
Dividends paid	(179,409		)	(140,000		)	140,000		(179,409		)
Repurchase of common stock	(217,454		)	—			—		(217,454		)
Issuance of common stock under employee stock option plans	2,180			—			—		2,180
Net cash used by financing activities	(394,683		)	(349,007		)	140,000		(603,690		)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(4,604		)	494			—		(4,110		)
Net decrease in cash, cash equivalents and restricted cash	$	(62,442	)	$	(248,183	)	$	—	$	(310,625	)
Cash, cash equivalents and restricted cash:
Cash, cash equivalents and restricted cash, beginning of period	$	544,548		$	715,200		$	—	$	1,259,748
Net decrease in cash, cash equivalents and restricted cash	(62,442		)	(248,183		)	—		(310,625		)
Cash, cash equivalents and restricted cash, end of period	$	482,106		$	467,017		$	—	$	949,123

	Nine months ended September 30, 2018
	HDMC Entities			HDFS Entities			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	469,370		$	171,801		$	(110,215	)	$	530,956
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	193,289			3,172			—			196,461
Amortization of deferred loan origination costs	—			61,213			—			61,213
Amortization of financing origination fees	497			5,710			—			6,207
Provision for long-term employee benefits	28,162			—			—			28,162
Employee benefit plan contributions and payments	(11,035		)	—			—			(11,035		)
Stock compensation expense	26,122			3,000			—			29,122
Net change in wholesale finance receivables related to sales	—			—			(18,400		)	(18,400		)
Provision for credit losses	—			72,462			—			72,462
Deferred income taxes	(2,991		)	4,343			105			1,457
Other, net	28,426			699			215			29,340
Changes in current assets and liabilities:
Accounts receivable, net	(169,168		)	—			154,384			(14,784		)
Finance receivables - accrued interest and other	—			1,374			—			1,374
Inventories	8,270			—			—			8,270
Accounts payable and accrued liabilities	170,001			152,028			(138,423		)	183,606
Derivative instruments	1,124			103			—			1,227
Other	19,411			3,173			(5,667		)	16,917
	292,108			307,277			(7,786		)	591,599
Net cash provided by operating activities	761,478			479,078			(118,001		)	1,122,555
Cash flows from investing activities:
Capital expenditures	(110,493		)	(9,352		)	—			(119,845		)
Origination of finance receivables	—			(5,845,799		)	2,806,639			(3,039,160		)
Collections on finance receivables	—			5,363,333			(2,798,638		)	2,564,695
Other investing activities	(21,753		)	—			—			(21,753		)
Net cash used by investing activities	(132,246		)	(491,818		)	8,001			(616,063		)

	Nine months ended September 30, 2018
	HDMC Entities			HDFS Entities			Eliminations		Consolidated
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—			1,144,018			—		1,144,018
Repayments of medium-term notes	—			(877,488		)	—		(877,488		)
Repayments of securitization debt	—			(224,507		)	—		(224,507		)
Borrowings of asset-backed commercial paper	—			120,903			—		120,903
Repayments of asset-backed commercial paper	—			(156,258		)	—		(156,258		)
Net increase in credit facilities and unsecured commercial paper	—			102,154			—		102,154
Dividends paid	(186,105		)	(110,000		)	110,000		(186,105		)
Repurchase of common stock	(195,998		)	—			—		(195,998		)
Issuance of common stock under employee stock option plans	3,157			—			—		3,157
Net cash used by financing activities	(378,946		)	(1,178		)	110,000		(270,124		)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(11,802		)	(765		)	—		(12,567		)
Net increase (decrease) in cash, cash equivalents and restricted cash	$	238,484		$	(14,683	)	$	—	$	223,801
Cash, cash equivalents and restricted cash:
Cash, cash equivalents and restricted cash, beginning of period	$	338,186		$	408,024		$	—	$	746,210
Net increase (decrease) in cash, cash equivalents and restricted cash	238,484			(14,683		)	—		223,801
Cash, cash equivalents and restricted cash, end of period	$	576,670		$	393,341		$	—	$	970,011